dc.description.abstract | Our purpose with this thesis was to illuminate a part of the real estate world that has long been
somewhat inaccessible for public research. We examined the constellation of owners of
commercial property in Kristiansand and calculated the Herfindahl-Hirschman index and
concentration ratio for this market. It is our hope that this descriptive analysis of the market
for commercial property in Kristiansand could be used for further research on market
structure and urban development.
Our thesis is based on second hand data from “Kartverket”, “eiendomsverdi.no” and the
municipality’s lists of valuation estimation in relation to taxation. We combined an extensive
mapping of market shares in the Kristiansand commercial real estate market from these
sources and based the calculations on this dataset.
Our results show that the studied market has a low concentration of providers of commercial
property. The index results were far lower than the critical values used by government
agencies for maintaining healthy competition. Although, we do suggest that high barriers to
entry might be present in the market and act as competition hindering factors. We observe that
over the last seven years the market shares of larger providers of commercial property has had
on average almost twice the increase in value compared to smaller providers, while larger
providers experience lower risk over the same period. There are multiple market effects
affecting competition, even though we document low concentration of providers additional
research is required to conclude if there is adequate competition in the market. | |